Dov Charney and his company American Apparel are kicking ass in the US clothing industry. And it's all thanks to a radical and controversial mix of porn-chic advertising and ethical working conditions

The Times Magazine
James Collard
Photos by Barry J. Holmes
February 12, 2005

I'll be honest. What first drew my attention to Dov Charney was his
backside - or "ass", as we're talking about the boss of American
Apparel. I missed business stories about the rag-trade entrepreneur
who, by manufacturing in the US, paying decent wages and making a
profit, was giving fast-buck competitors a run for their money. I
failed to hear the coolhunters declare that AA products (T-shirts,
trackies, undies and sweatshirts) are as cool as can be, as they're
logo-less, as well as "sweatshop-free". I missed a quirky article in
The New Yorker in which Charney took Malcolm (The Tipping Point)
Gladwell to a strip joint, and an even quirkier piece in [a popular women's magazine]
(of which more later). What got my attention was an advertisement
featuring a bare-assed Charney wearing nothing but an American Apparel
T-shirt emblazoned with the legend "Legalize LA". A cute enough ass,
if you like that kind of thing. But what struck me about the ad was
the juxtaposition of what looks like an out-take from a Seventies
porno movie with the copy below, spelling out AA's mission to pay
decent wages and provide good working conditions. "You got turned on
to us by an ad?" Charney exclaims when we meet in LA.

"Wow!" he shouts, leaping up and clapping his hands. But much of what
we need to know about this extraordinary 36-year-old can be gleaned
from that ad. That he's unashamedly interested in sex; that he's a
self-publicist (few other entrepreneurs would have the chutzpah to
employ a half-naked picture of themselves in an ad campaign); and that
he's a gifted marketing man. He also has something to say. Well, a
lot. One reporter recalls making some 30 tapes of Charney for a story.
I got an hour with him in his nice but hardly flash home in Echo Park,
an up-and-coming suburb of Los Angeles.

But Charney still managed to talk about everything from John Locke to
the high pound of the Sixties, sex (of course) and open borders, of
which he is a huge fan. He talks breathlessly about the hidden costs
that can make outsourcing the expensive option. He argues that
offshoring (moving manufacturing to the Third World) is an inefficient
option taken by intellectually lazy executives. And he explains how,
with AA doubling revenue every year for the last four, to some $80
million, he's "going to make it look foolish to roll all the way to
Bangladesh to make T-shirts".

Think of LA, and the palm-lined suburbs inhabited by overpaid
entertainment industry workers spring to mind. But within an hour's
drive of Beverly Hills lies downtown LA and what remains of America's
garment industry, mostly sweatshops where regulations go unenforced
and immigrants (often illegal) work in conditions little better than
in Asia. Here the vast pink factory block housing AA is a beacon of
hope for many garment-trade workers, who form an eager line every time
AA advertises for new staff to join its 3,800-strong workforce. People
work very hard here - yet in decent, airy conditions; workers earn, by
industry standards, very good money. They get lunch breaks, free
massages, medical insurance and English lessons. Charney even gave AA
workers a paid day off to demonstrate against a new law that would
require driving licence applicants to produce immigration papers. If
we really believe in free trade, Charney argues, then we should
welcome the flow of fresh talent, ambition and ideas that comes with
mass immigration. That's what gives countries like the US, the UK and
Charney's native Canada their edge. In fact, while the brand sounds
reassuringly patriotic to customers in its largest marketplace,
Pan-American Apparel might be a more apt name, given that most of the
factory-floor is Hispanic, while much of the office hails from Canada.

Charney is upfront about lessons America could learn from its more
socially inclusive neighbour. "Cross the border from Toronto to
Buffalo." Toronto enjoys both a very high standard of living and the
quality of life you find in a society willing to invest in
infrastructure and social equity, then, "You hit the United States and
think, 'Holy shit! They've got some problems over here.' But give
people a little bit of a better education, the smallest opportunity
and, well, it's the same with garment workers. Give them a little bit
of a better life and they'll work ten times harder."

Charney grew up in the same Anglophone, liberal, non-observant Jewish
intelligentsia in Montreal as Naomi "No Logo" Klein. For a time he
even went to school with that poster-child of the anti-globalisation
movement - although Charney mischievously recalls young Naomi as "a
brand-sucking princess snob" (which, in fairness, she has fessed up
to). American Apparel's clothes have no logo - logos being as
attractive as the mark of Cain to those young urbanites who are its
target constituency. But while Charney and Klein share a distaste for
capitalism's grubby cruelty and glib badges, their similarities end
there. Charney is too much the optimist and entrepreneur to spend time
on analysing and agonising when he could be making money and building
the New Jerusalem in downtown LA.

A sign outside his factory says a lot about the mix of influences at
work in Charney. "This way to American Apparel," it announces. "The
Sweatshop-Free T-shirt Kibbutz Owned and Operated by Dov Charney."
Israel's kibbutz movement was the flowering of that Jewish socialist
tradition that Charney's grandfather Hymie carried with him from
Poland to Canada. But for all its virtues - and even Charney's
apparent lack of interest in the trappings of wealth - American
Apparel is hardly a workers' co-op, and Charney also enjoys likening
himself to a Jewish "schmatta" - or rag-trade - businessman of the old
school. He is always looking for ways to make American Apparel's
operations more efficient. Employees are paid a minimum of $7 an hour:
way above sweatshop rates, but nothing to write home (to Mexico)
about. What they earn above that depends on what they produce - or
rather, what their team, comprising four or five workers, produces.
The team's hourly rate, based on how quickly they're working, gets
chalked up, the best reaching as much as $18 an hour. The beauty of
this system is that, at AA, it is in every worker's interest to spot
what "constraints" hold back production and to identify solutions,
thereby achieving ever-higher efficiencies. It's an impressive
operation, not arrived at overnight. Charney started out by stocking
up on cheap T-shirts at Kmart in the States while still a student at
Choate Rosemary Hall (the posh Connecticut school attended by JFK),
screen-printing them and selling them, with a mark-up, back in
Montreal. After one year at Tufts, Charney dropped out of college to
sell - and ultimately manufacture - T-shirts for the wholesale market.
He found that cutting out middlemen and contractors saved money - some
of which could be passed on to the workers, who in turn worked harder.
So while Charney makes erudite allusions, he arrived at American
Apparel's modus operandi through experience in business, which makes
him convincing when he shoots down the conventional wisdom of
management consultants who have spent the past two decades pushing the
outsourcing model as the only way forward.

"Vertical integration" is Charney's strategy for outperforming the
opposition, meaning that everything from manufacturing to designing
AA's saucy ads takes place in that pink building. This might run
contrary to the prevailing orthodoxy, but, for Charney, it works. "You
see that little detail there?" he asks, pointing at the collar of a
vintage shirt picked up in one of his trawls around the city, in which
he photographs people and places and checks out thrift stores. "I
could have that shirt made and in my stores by Friday. Design it on
Monday, cut it on Tuesday, sew it on Wednesday, ship it on Thursday,
it's in New York on Friday. They can't do that," he says of
competitors such as Fruit of the Loom (although of course stock headed
for AA's new London store on Carnaby Street might take a day or two
longer). Charney has focused on detail - and on the fit of his
products - ever since he spotted that his girlfriends wore boys' Ts in
preference to the shapeless numbers available at the mall. Hence that
strip-joint foray with Gladwell, where much to the strippers'
surprise, Charney asked them to put clothes on, in order to see how a
new AA range would work for women of all shapes and sizes. Nice work
if you can get it? Well, there are times when Charney's libido seems
key to American Apparel's commercial edge. Like those eye-catching ads
that so outrage many PC Americans. "They say, 'Well he's meant to have
this social conscience, so why is he putting these sexy girls in the
advertising?'" But for the hip young constituency Charney courts, porn
aesthetics are by no means incompatible with a social conscience. And
the fact that the ads (featuring friends and employees) sometimes
really do look like out-takes from home-made porn stops AA seeming too
worthy, lending an aura of transgression to what is after all generic
- if well-cut, well-made and ethically manufactured - clothing. But
there have been occasions when the crossing of boundaries hasn't
seemed quite so cool - most notably when a female reporter from [a popular women's magazine]
got to see more of Charney than we see in that ad and then
wrote about it. I'd been told this story would be off-limits, but
Charney raised the subject himself, explaining how what he'd imagined
was "a little secret" turned out to be on the record, not off.
Embarrassing? Charney quips that after the story ran, he was flooded
with applications from women who wanted to work for him at AA, where
in the past Charney has talked up mixing business with pleasure.

"When everyone is doing everyone else, it's good for morale," he once
teased. "No one can wait to come to work." The logical conclusion of
Charney's business theories, in which everything gets done in-house?
The day I visited the AA offices they seemed disappointingly normal,
if upbeat, with staffers up to nothing wilder than an honest day's
work. And if this otherwise model employer sometimes enjoys some slap
and tickle with a co-worker? Well the accents might be different, but
somehow it all seems more Bloomsbury than bonkfest. More to the point,
a notice displayed around the building announcing the death of one
young employee (shot dead, AA to provide transport to the funeral,
along with security) makes me very much inclined to give Charney,
probably the closest thing to a model employer in downtown LA right
now, the benefit of any doubts. He's never claimed to be a saint,
after all. Rather the opposite.

And I can't help wondering if there isn't some connection between all
that energy - and the potentially life-changing opportunities to be
found in that large pink building - with a maybe slightly
larger-than-life libido.

Still, it's hard to imagine one of Joseph Rowntree's employees coming
out with the impromptu mission statement I heard from one American
Apparel employee: "You know what? We're young, we have fun, we party,
we f***, and we make money in a socially responsible way. It's cool."